This thread is going to become a sticky. Everyone is welcome to contribute content that they find! From time to time, I'll go through and purge out (delete) posts that aren't actually content (as the thread won't be fun to read if most of it is people's replies).

CSL content allowed. Other generation M3's not. Other BMW's not.

If you're posting an article, please quote the article in your post and include a link to it. Makes the thread more fun to read!

Why You Want an E46: The E46 M3 combined many of the best qualities of the two M3s that came before it, effectively silencing any complaints that BMW’s M division had grown complacent. Unlike the E36 it replaced, the E46 M3 was carefully differentiated from its lesser brethren. Mechanically, this meant that countless suspension and body components—everything from control arms and subframes to damper anchor points—were strengthened, stiffened, or relocated in the search for speed and durability.

Cosmetically, the E46 paid homage to the E30 with special fender flares front and rear, and its fender vents were meant to recall the 3.0CSL of the 1970s. (Little did BMW know they would become a popular glue-on accessory for every pimped ride—and then factory-produced models—during the next few years.)

Under the E46’s domed aluminum hood, BMW again installed a 3.2-liter inline-six, this version being an evolution of the more expensive engine that powered European E36s. It spat out 333 hp and a coarse metallic rasp, leaping for its 7900-rpm redline like a machine possessed. This should be more than enough to satisfy enthusiasts who are concerned about the E46’s 3450-pound curb weight.

Choosing Which One: Like the E36, the E46 M3 was offered in a wide variety of colors and with numerous options. The sedan configuration, however, was dropped for the E46, and coupes are more common—and desirable—as the convertibles pair a too-stiff suspension with a scuttle-shake-prone chassis.

Model-year changes were minimal, the most significant being the introduction of BMW’s six-speed sequential manual gearbox (SMG), an electronically shifted version of the M3’s standard six-speed manual. U.S. buyers were turned off by its punishing shifts and lack of involvement, so traditional sticks are more common in the E46 M3s here.

Although Americans couldn’t buy the lightweight CSL model introduced to Europe in 2003, select CSL parts were later found in the 2004–06 Competition Package variant that offered a quicker steering rack; unique wheels and trim; and larger, cross-drilled brakes. Cars so equipped are the most difficult to come by; happily, you can easily build one by cracking open your checkbook and a factory parts catalog.

This was the first M3 offered with factory navigation, and cars so equipped tend to be worth slightly less on the used market, but that varies with location and overall condition. BMW’s certified pre-owned lots and the enthusiast classifieds are generally the best places to look.

Watch Out For: The E46 is a fairly stout car, and it offers a beguiling combination of straight-line speed and modern polish. Durability, Thongsai says, is less of an issue than it is for the E36, and he notes that the E46 tends to cope better with hard use—everything from suspension-bushing life to interior wear is improved—than its predecessor. “The cooling systems are usually a bit longer-lived,” he says, “and the thermostat is set to run a little cooler than it does on the E36, which may help. By and large, when driven sensibly, they seem to hold up.”

Other issues: Early cars suffered from rod-bearing issues that were dealt with by a factory recall, so check with your local dealer to make sure this has been done to any car you might be considering. SMG-equipped examples often suffer from hydraulic-pump failure; the pump costs several thousand dollars. (As of this writing, a replacement clutch slave cylinder is nearly 1000 bucks.) As with the E30, valve adjustment is required every 30,000 miles.

It'll be ancient history by the time you read this but I've just sat through the US Grand Prix. Not a great advert for the 'pinnacle of motorsport' in a country that already struggles to get excited about F1. Ferrari's victory was an empty one, but watching the onboard footage of Schuey flat to the boards through Indianapolis' banking, sitting at over 200mph and 18,000rpm for a full 20 seconds and then wiping off 130mph in just a few yards and peeling into Turn One is gobsmackingly, jaw-droppingly impressive.

What's that got to do with the new M3 CS? Well, just like the Ferraris at the Brickyard, the M3 has little meaningful competition; and like those screaming F1 missiles the BMW is no less impressive because of it. The CS is essentially an M3 that's borrowed a few tasty bits from its exotic, expensive and now out-of-production CSL sibling. Bigger brake discs, the quicker steering rack, revised springs and those gorgeous 19in forged alloys.

Okay, they're not quite as light as the genuine CSL rims but they still look great, and if the newfound composure and ride quality are anything to go by they're definitely a whole heap lighter than the ubiquitous 19-inchers that regular M3s roll on. As well as the mechanical changes, the CS also gains the CSL's M-Track mode function, heightening the stability control's tolerance of slip angles and wheelspin to such an extent that even the very best drivers are equally quick around a track with the electronic safety net still in place.

The price of these mechanical, cosmetic and electronic tweaks is just £2400 over the standard £41,115 M3. This package has been sold in the US and Europe for some time as the 'Competition Package', but BMW GB was concerned that the optional upgrade may upset CSL owners, who have already been hit in the wallet. Now that CSL residuals are firming up and with the launch of the E90 3-series, BMW GB decided its 911-chaser needed a shot in the arm.

There's nothing to touch the CS at the money. The Monaro VXR is cheaper and more powerful, but it's a blunt instrument compared to the scalpel-sharp BMW. Audi's powerful new RS4 should be up to the fight, but prices start at £50K. So the CS's closet rival is, in fact, the standard M3.

And the good news is that the CS has a sharpness and accuracy that the M3 never quite attains. You'll notice the new steering rack first, with its meatier weighting and more immediate response. Then you'll realise that the ride seems flatter, less disturbed by sharp lumps and bumps passing beneath the wheels. Up the pace and this firm but pliant set-up just gets better and the M3's trademark pogo-ing motion never materialises.

What hasn't changed is that wonderful, free-revving 3.2-litre 338bhp straight-six; it may lack the CSL's snorting induction system but it's still a stunning accompaniment to the fluid, fleet-footed chassis. Wrung out past 8000rpm it has more than enough top-end fireworks to justify the street-racer stance.

The straight-six has too much power for the brakes to rein-in, despite bigger discs. They're overwhelmed by the engine's venom and quickly protest when used hard on the road, with expensive-sounding groans and a soft pedal. Even snicking down through the slightly long-winded manual 'box to help deceleration (SMG is an £2100 option) does little to halt the brakes' decline. Fortunately the CS is so entertaining through the turns that you're happy to drive around the weak brakes and instead revel in one of the most throttle-adjustable chassis in the world.

I can't think of another 300bhp+ car that feels so benign when you tweak the tail wide and play out a slide than the M3 CS. There's a bit of understeer in steady-state cornering but the 255-section rear rubber is easily overwhelmed if you're of a mind, and from there it's simply a matter of balancing the opposite lock with power.

Of course, you can do the same in a standard M3, but the CS has tangible gains in feel and agility and quickly gives you confidence to use all of its potential. The CSL was always a great car with a crazy price- tag. The CS is just a great car, and if you're buying an M3 you'd be crazy not to pay out £2400 for the added bite, polish and aesthetic attitude that it brings.

The players may be getting faster, louder and ever more sophisticated, but the script never changes. It goes something like this: a new hot Audi is launched, with class-leading power, huge cross-country pace and the sort of pumped-up, hunkered-down appearance of a heavyweight boxer in a slim-cut Savile Row suit. Meanwhile, the ageing, down-on-power BMW M3 saunters quietly alongside and slowly but surely picks the latest and greatest Audi apart piece by agonising piece, in so doing reaffirming itself as the ultimate all-rounder.

To add insult to injury, a few months later a brand new M3 will usually be launched, the segment redefined, and Audi (and the rest) must start the inevitable game of catch-up. As sure as night follows day, the M3 will always be a step ahead of the competition. Untouchable, delectable and deeply desirable.

The spec sheet suggests little has changed with the launch of the new Audi RS4. It has 414bhp to the M3's 338bhp. The quattro system is more sophisticated than ever and channels the monster power to four broad 255/35 R19 contact patches. That's the cross-country pace taken care of. Then there's the appearance that's so tough you hardly dare look it straight in the piercing xenon eye. So far, so predictable... But it's in the detail that the RS4 seems to be going seriously off book.

That quattro system now has a distinct rear bias (40:60), all the better for balance and interactivity. The 4.2-litre, 48-valve, normally-aspirated V8 engine could have been developed within the walls of BMW's M Division such is its free-revving nature (the rev-limiter halts the madness at 8250rpm) and creamy-smooth yet unmistakably hard-edged voice.

This is a new sort of fast Audi, and having tasted its potential in Italy (evo 085) we were desperate to find out if the cycle had finally been broken. Has Audi really torn-up the script and built a car to surpass the mighty, iconic, and - with the introduction of the CS package - better-than-ever M3?

The Audi-versus-BMW battle is the main event, no question, but we've also brought along a Mercedes C55 AMG. Often overlooked, the C55 is surprisingly nimble to drive and awesomely fast. Its 5.5-litre V8 thumps out 367bhp and enough torque to take chunks out of freshly-laid tarmac. Think of it as an SLK55 with a fixed roof and four seats. And without the image problem. Make no mistake, the C55 has the potential to give both RS4 and M3 CS a serious run for their money.

We're in Wales, where else? Okay, we're not exactly getting in the spirit of Audi's attempt to explore uncharted territories and hit new highs but, a bit like the M3, the roads that criss-cross North Wales are the benchmark against which all others must be judged. When you want definitive answers to the big questions, there's nowhere better to seek them.

The M3 looks the best value, but such is the ubiquity of BMW's searing baby on the used market that the lower initial outlay will quickly be negated with tumbling residuals. These three are perfectly matched.

Parked side-by-side, all three cars gently pulsing to the beat of their potent engines and gradually shedding the thick layer of ice that's clinging to their bulging bodywork, it's the Audi that punches out of the fog and demands your attention. Of course, it's the least familiar, which lends it an air of mystery, but the beautiful multi-spoke alloys, bold face and heavily swollen arches combine to make the sober C55 look, well... limp. Even the M3 seems to be cowering in the RS4's presence.

While road test assistant Hayman draws on his tenth cigarette of the morning, and Roger Green discusses the shoot-list with photographer Morgan, I jump into the Audi's hot seat... Ah, heated seats. Don't you just love 'em?

The RS4 is soon up to temperature. As we thread along the narrow roads that will soon open up, climb, fall, flick, swoop and generally do their best impression of an Alton Towers roller coaster, there's no question I've chosen the right car. The seats are wonderfully gripping and supportive, the funky flat-bottomed steering wheel perfectly positioned. The cabin feels worth every one of those fifty thousand pounds. Nobody does this sort of thing better than Audi.

More surprising is the RS4's ability to glide over nasty ridges and clumsy surface 'repairs' with impeccable wheel control and no hint of kickback through the steering. It feels light on its feet and even at modest speeds the chassis has a balance and responsiveness that immediately sets it apart from any other Audi I've driven. It's big brother, the mighty RS6, feels like a ballistic steamroller by comparison; all muscle and no subtlety. Clearly the RS4 signals a new philosophy for sporting Audis.

We swap cars at the Shell station in Betws-y-Coed (which must be one of the most profitable petrol stations in Britain. Behind the counter, there's a photo of one of their better days: a line-up of Enzo, F50, 288GTO and F40, with one John Barker feeding them Optimax). I now find myself in the C55 AMG, chasing the RS4. The roads are still slick with morning dew, and despite the bellowing 5.5-litre V8 shoehorned into its engine bay, the C55 has no meaningful reply to the RS4's awesome combination of immense grip and ferocious power.

Incredibly, when you think of Mercedes integrity just a handful of years ago, the C55's interior feels cheap after the supreme quality and cool design of the RS4. The plastics are hopeless and the dash is a mess of tiny buttons with indecipherable legends. The C-class may be in the winter of its life, but the RS4 makes it feel obsolete already.

Still, with the RS4 long gone I can concentrate on just what the C55 has to offer as a driving experience. The ride isn't as settled as the Audi's: the damping feels slightly less controlled and there's certainly more body-roll and pitch. The steering has a dead patch either side of neutral but then weights-up nicely, and although it's by no means the most feelsome of systems it does start to feel more accurate the quicker you go.

Like all AMG products, it's the engine that really defines the C55's character. It doesn't rev to the heavens like the RS4's V8, but in the mid-range you can feel the advantage of that extra displacement. Any throttle movement is rewarded with an instant, neck-snapping response, and the thick seam of torque morphs effortlessly into an anarchic, almost shocking top-end. The Mercedes' bombastic mid-range delivery makes even the RS4's mighty power unit feels like a VTEC. The C55 may have just five gears and be hampered by a conventional torque-converter auto, but it's clear that in a straight line fight it's anything but outmoded.

With the winter sun burning the early- morning fog from the sky and rapidly drying the road surface, perhaps the Mercedes will start to shine. It seems that the M3 CS already is. Hayman drove the car across to Wales last night and was keen to stick with it this morning.

'After the fantastic memories of our Car of the Year test, I have to say it felt a little ordinary yesterday,' he sighs. Fortunately there's more: 'Up here it's incredible, though. Even in these conditions and with its power deficit, it can happily match the RS4. And the balance is just so good.' Sounds like the cue to reacquaint myself with an old friend...

Where's all the power gone? Ah, there it is - much higher up the rev-range. And what a noise! All high-tech, high-displacement fizz and crackle. Incredible throttle-response, too. The CS feels light, razor-sharp, almost devoid of inertia compared to the lazy Mercedes, and against expectations the M3 has more faithful front-end grip than even the RS4. That's the advantage of having a straight-six tucked well back in the engine bay rather than a V8 slung out ahead of the front wheels.

Activate M Track mode with a prod of the button on the tactile suede-rimmed steering wheel, and you're allowed more slip before the traction and stability systems call a halt to the fun, enabling you to use that strong front-end grip to feel your way into the M3's immensely gifted chassis. There's less torque than a thumping V8 produces, but the payoff is superb traction. Even pinning the throttle from the apex of greasy third-gear corners fails to excite the relaxed stability system.

The rear will move a few degrees when you're deep into the power-band and really leaning on the Michelin Pilot Sports, but as it does so the information from the steering (the CS benefits from the quicker, more feelsome CSL rack) and through the seat cushion almost draws a picture in your mind of the car's attitude - it's like an out-of-body experience.

Stay committed and the CS scythes cleanly through the corner, totally balanced, completely hooked-up. When you're dialled-in to the chassis and really nail a road in the M3 it's so unhurried, so serene. You could almost set it
to music. I love this car.

Roger Green has had his fun in the M3, too. But emerging from the RS4 he seems like a man with something to get off his chest. 'It's just so fast. The engine is a monster, and the way it deals with nasty roads is very un-Audi-like. The gearchange is fantastic, the steering smooth and consistent. And those eight-pot brakes are superb. Phwoar!' He likes it, then.

And the Merc? Hayman didn't get off to a great start with it. He didn't realise you have to engage 'M' on the transmission tunnel for the steering-wheel-mounted up- and downshift buttons to work faithfully, and kept finding himself fully committed mid-corner only for the 'box to kickdown, the tail to snap sideways and the ESP to clumsily tidy things up. Now enlightened (he only had to ask) he's warming to it. 'Incredible torque,' he says, 'nice steering feel once you're up to speed, and although it rolls a bit at modest speeds, the body control is actually very crisp when you're on it.'

I'm pretty much in agreement with the Haymanator. In fact I'm unexpectedly falling for the C55. It's so full of character you can almost forgive it the dodgy interior and staid lines. And despite a more understeery initial balance than either RS4 or stubbornly neutral M3, it's very easy to impose your own will on the car. The ESP can't be switched off completely, though, which is annoying on track or even on bone-dry, well-sighted roads, but on damp, leaf-strewn tarmac the system is perfectly judged in its most lenient setting (just prod the ESP button and watch for the yellow triangle glowing on the dash).

One particular corner illustrates the point perfectly. An uphill left taken in third and blind until the apex. Coax the front tyres onto line, feed in some power and immediately the V8 takes the modest-looking Pirelli rubber to its limit, the tail edging out enough to require just a flick of opposite lock. Keep a steady throttle and the C55 stays up on its toes, gently drifting, ESP allowing free rein.

As you crest the rise and see the road ahead is empty, a bit more gas adds to the angle. Too much and the ESP recovers the slide. Get it right, though, and the C55 dances with a delicious angle until the road straightens. Then it explodes along the next straight in one violent lunge. Few cars have such a grin factor.

So, the M3 CS is, as we discovered last month, a truly bewitching car. More surprisingly, the C55 is getting under our skin, too. But the RS4 has a kind of magnetic draw. You can often hear it tearing towards its redline, even when you're wringing the neck of one of the other cars, and especially if the Audi's driver has hit the 'S' button, freeing the exhaust, sharpening the engine's response to your right foot and increasing the seat's grip on your torso. It's a tight, metallic howl, cutting through the cold air with a fervour that even the screaming M Power straight-six can't muster.

Let's break down the constituent parts that set the RS4 apart from other hot Audis. First and foremost there's the linear steering response. It's still a Servotronic set-up and perhaps just a shade on the light side, but unlike, say, the S4, the changes in assistance as your speed varies are imperceptible.

The manual 'box is slick and positive, and the brakes are exceptional (the eight-piston front callipers grip 365mm discs), displaying none of the hyper-sensitivity that often makes Audis tricky to meld with. It all feels just right.

The engine is one of the greats. At low revs there's ample response (unless you've just stepped out of a C55), and it feels genuinely muscular even when lugging at 2000-3000rpm. At 5000rpm you're flying, and then, just when most V8s are starting to huff and puff under the strain, the RS4 kicks again and hammers on to 8250rpm. Never once does it feel overstressed or unenthusiastic. It gives the RS4 a soul.

That the chassis not only contains the V8's muscle, but actually encourages you to cling on to every last rev and search out every scrap of horsepower, is a testament to the latest incarnation of the quattro drivetrain and the clever pitch- and roll-reducing DRC (Dynamic Ride Control) suspension system.

That it very rarely feels nose-heavy or doggedly understeery is vindication of the decision to send more of the power to the rear wheels. Here's an Audi with a nice neutral balance and genuine nimbleness. How long
have we waited to say that?

So it kills the M3 CS, then? Well, not quite. At eight-tenths the RS4 feels exceptional, and even when pushed to its very limits it retains much of its composure. However, it's still true to the Audi philosophy, which means it will always look after you first and foremost, even when you just want a bit of entertainment.

Towards the end of two days of fantastic driving it's fair to say that our collective confidence is up and our pace has escalated. Suddenly the RS4 doesn't feel so impregnable. The ride, so unflustered and reassuring until now, deteriorates as our commitment grows. The body control starts to betray that peculiar engine position with slightly clumsy crashing where before it had glided.

It's very busy under braking, too - somewhat unexpected considering the car's inherent stability. And ultimately, despite the clever four-wheel-drive system that can channel as much as 85 per cent of power to the rear wheels, it becomes clear that mild understeer is still the RS4's preferred stance.

The RS4 is a mighty achievement, a sea-change for fast Audis that hints at how good the mid-engined R8 might be when it arrives later this year. But where the BMW and the Merc taught us new and exciting things the harder and further we drove them, the Audi lost just a bit of its lustre. Perhaps it's a victim of its mesmerising first impression. It's an impossible standard to live up to.

By contrast the Mercedes feels remarkably average on a quick squirt, but beneath the off-putting 'box and initially odd steering feel is a chassis that is incredibly engaging. Even so, it can't scale the heights of the Audi or BMW. It's
a softer, less focussed product. Still, its peachy balance shows that AMG could really deliver the goods if they wanted to.

No surprises then. It comes down to RS4 and M3 CS. After ten minutes behind the wheel the RS4 was my winner. It's got the looks, the interior, the edge on performance. Forty-eight hours later, the deft balance, awesome adjustability and sheer exuberance of the M3 CS seemed insurmountable. It gives you so many options, and I don't just mean you can oversteer it all day long (which you can). It has incredible balance, and it's so responsive to your inputs that you feel intimately involved through every part of every corner. For you and me, that's what really counts.

The M3 is still the all-conquering action hero. Did I mention there's a new one later this year?

"Imagine a transmission that not only works with you, but can make you feel like a professional race driver." That's how the brochure of BMW's new SMG (Sequential M Gearbox) reads. A pretty hearty claim. From any other manufacturer, we'd dismiss this statement as unsubstantiated marketing fodder, but coming from a company such as BMW — which has long been involved in all types of racing — it warrants closer inspection. Online Services Editor Kim Wolfkill and I drove the M3 with SMG to the Streets of Willow Springs, a tight road course near Los Angeles, to see if we would indeed "feel like a professional race driver."

But before we get into the actual driving, here's a little background on the SMG. (See Technology Update , January 2002, for full details.) The SMG is a manual gearbox that also has the capability to perform like a fully automatic transmission. Manual shifting is performed sequentially through a shift lever or paddles located behind the steering wheel.

Unlike "smart automatics," which also allow the driver to choose gears manually (a la Porsche Tiptronic), the SMG has done away with the torque-converter/plan-etary-gear setup, allowing the drive to be more direct and shift times more immediate. It's one of a few such systems on the market today, the others being manufactured by Magneti-Marelli (used by Alfa Romeo, Aston Martin, Ferrari and Maserati) and Toyota, whose SMT is in the MR2 Spyder.

BMW's SMG transmission has a total of 11 auto and manual settings, and can be operated via the shift lever or steering wheel-mounted paddles. Dash display for program mode mimics the pictogram on the shifter.

The SMG has a total of 11 settings, six in manual mode (S1 through S6), and five in automatic (A1 through A5), adhering to the company's recent pattern of over-complicating its technology features. In both modes, level 1 is the most docile with levels A5 and S6 being the most performance-oriented. In S6, the upshifts are so fast they tend to be abrupt, and you can only activate it with the traction control system turned off.

On the way to the track, the M3 with SMG proved a delight. In dense freeway traffic, the gearbox in A3 behaved like a conventional automatic, with the driver required to do nothing more than operate the throttle and brake pedal. I chose A3 here because in A5 the system waits until engine speed reaches about 5000 rpm before upshifting; in A1 or A2, it does so too early. Wolfkill, who was in a conventional 6-speed manual M3 right behind me, told me his stop-and-go commute was rather more unpleasant.

There's a brief lapse in the application of power as the system readies to grab a higher gear, which tends to jerk you forward, as if someone had lightly shoved you in the back. Despite the slight inconvenience, it beats having to operate a manual in stop-and-go traffic.

Driving near 10/10ths on the track, the SMG performed flawlessly. In S6, upshifts and downshifts were lightning quick, and you could hear the system matching engine revs on each downshift. BMW claims that the SMG can make shifts in 0.08 second, faster than most of us can with conventional gearboxes. After sampling the SMG, we each lapped the course in the M3 equipped with the conventional manual gearbox.

The conventional manual was nice, too, but the SMG was quicker and more comfortable because it allowed us to concentrate more on steering, braking and accelerating, without experiencing any sacrifice in lap times.

Wolfkill liked it too. "Whether it's on the street or at the track, the SMG takes the work out of shifting. For highly experienced drivers, I suspect the biggest advantages at a racetrack will be the greatly reduced upshift times, but there's also no denying the convenience of paddle shifters; just ask any Formula 1 driver."

There are those who dislike the system. Executive Editor Douglas Kott is among them, saying he'd take a conventional 6-speed any day. "SMG's auto mode (lurch/pause/lurch) is certainly inferior to a conventional automatic's operation. And with a standard box, there's a far more satisfying interaction with the machine."

So the SMG is not for everyone. But for its $2400 price, I'd take it in a heartbeat simply because it offers the best of both worlds: On the freeway, SMG provides a luxury that you just can't get with a conventional stick shift, and at the track, well, it makes you feel like a race driver.

Brag all you want about the last BMW M3. Hey, we sure did. Profess about its being the king of compact sport coupes/sedans. But the fact is that the previous E36-platform M3 gets flat-out trounced in just about every way by the new E46-based design. How? Thanks to a thrilling new 3.2L DOHC inline-six that delivers a sky-high 8000-rpm redline, 333 serious horsepower, and a torque curve flatter than Kansas. Don't forget its wider-track, larger-rubber, race-inspired brakes and redesigned suspension. Factor in a more aggressive look and upgraded interior appointments, and you begin to get an inkling of what the '01 M3 is all about.

Clearly, the main performance-generating element of this new, maximum-strength M3 is its M-tuned inline six-cylinder engine, which shares only 5 percent of its parts content with the old one. At 198.1 cu in., its displacement is but 1.4 percent larger than its predecessor's-yet it cranks out an impressive 93 more horsepower and 33 lb-ft more torque. That's a serious increase in specific output. Moreover, it delivers 80 percent of its maximum torque at 2000 rpm, and maintains that level all the way to redline. The icing on the cake is that the engine will happily assault your nearest autobahn all day long-while still complying with strict LEV emission standards.

What makes the new engine so much brawnier than its older brother? The key is a new crossflow-cooled, four-valve-per-cylinder head that incorporates lighter intake valves, sodium-filled exhaust valves controlled by smaller (lower-rate) springs and lighter retainers. An all-new rocker arm-like setup replaces the previous, heavier cup-style tapped design, which in turn delivers a 30-percent reduction in valvetrain weight and 40 percent less valvetrain friction. This low mass hardware is what allows that nearly stratospheric 8000-rpm redline (the previous M3's limit was 6200 revs).

BMW's technologically advanced double-VANOS variable-cam adjustment system returns, but now works in harmony with a new, more aggressively programmed MSS-54 engine-management system. While the old M3's induction setup consisted of three two-barrel intake runners, this powerplant makes use of six individual throttle bores with inlet blades controlled by a throttle-by-wire setup. Additionally, specially contoured, F1-like composite air inlet runners translate into a 7-hp increase alone, according to BMW. Don't forget about the free-flowing, four-pipes-out-the-back exhaust system, which is quickly becoming another M trademark.

The M3's quick-revving power is shuttled through an excellent manually actuated six-speed gearbox (from the M5 parts bin), but rumors abound that a new F1-style, clutchless, Sequential M Gearbox (SMG) will be available in 2002. Out back, the M3 makes use of a new variable M differential lock, incorporating an internal pump that applies hydraulic pressure to seven small clutches when rear wheelslip is detected. Combined with the M3's new Dynamic Stability Control (DSC), the M diff lock provides outstanding traction on slick surfaces-even when the gas pedal is drilled flat to the floor.

It's important to remember that "M" means more than "motor." BMW has always given its M-branded models a thorough workover, meaning that the exterior appearance, interior packaging, suspension, brakes, and all other components are balanced to each other as the high-performance wick is turned up. This newest M3 more than successfully lives up to that mission statement.

In contrast with the engine's clean-sheet design approach, the E46 M3 retains many of the proven chassis features of the earlier (and certainly well-respected) E36 M3, but incorporates several key upgrades that make the new platform even better. Topping the list is a wider track (59.4-in. front/60.0-in. rear) combined with larger and wider 18-in. M Sport wheels and aggressive rubber. Although European M3s get huge 19-in. wheels, U.S.-bound cars employ 18x8.0/18x9.0-in. forged aluminum wheels with a new extended hump design that prevents wheel/tire separation during loss of tire pressure. Front suspension geometry has been revised to incorporate a smaller kingpin inclination and a larger caster angle, and a special aluminum thrust plate is bolted between the front control arms and revised axle support bearings. Larger-diameter disc brakes from the M5 halt the new machine better than any of its M3 predecessors did; however, the Euro-M3-spec cross-drilled rotors will not cross the Atlantic.

The M-ified 3 Series gets a restyled nose that incorporates a special front air dam, ellipsoid foglamps, big air-intake scoops, and revised grilles. A new "power dome" hood not only looks aggressive, but is constructed of aluminum, making it 40 percent lighter than a steel piece. Modest wheel flares and a micro-size rear decklid spoiler further crank up the attitude quotient. Front fender-mounted side vents are not only functional, but recall those of the early-'70s BMW 3.0 CSL. Overall, the look is substantial, and effective at communicating the M3's performance message (translation: It looks awesome!). An M3 convertible is slated for '02, but an M3 sedan is not expected, at least for now.

Inside, the M treatment turns up the driver-oriented sportiness factor by at least a notch, without sacrificing any of the 3 Series' solid ergonomics or overall comfort. Well-bolstered M sport seats give outstanding support, thanks to their adjustable internal air bladders; and new, gray-hued gauge faces are easier to read during spirited driving.

Enough engineering mumbo-jumbo: What's the new M3 like to drive? A tach-pegging, tire-abusing, power-sliding, apex-hitting, ear-pleasing, ultra-precise high-speed thrill would be one way to describe it. And we had a genuine F1 racecourse at our disposal-the Circuito De Jerez, home of the Spanish Grand Prix-on which to experience it.

The power comes on hard, even at low rpm. And as you'd expect with a perfectly balanced inline-six, its delivery is extremely smooth. Given its relatively small displacement, the power curve is impressive, and not at all peaky as we anticipated. Then, there's that sound: the raspy burble that can only come from a straight six. It thrums deep and mellow at idle, yet hardens to a hoarse wail as the revs rise, and on to a full-throttle battle cry as you near the red side of the tach. Pure magic.

While BMW's chassis engineers would probably prefer we talk more about the M3's handling, any genuine enthusiast will be giddy over the fact that this thing burns rubber like a Hemi 'Cuda. With the DSC system activated, straight-line traction is great; but while attacking Jerez' curves, we discovered the computer watchdogged the M3 into a plowing understeer that was hard to correct for, although it does indeed safely scrub off speed. Fortunately, switching off the DSC awakens a wholly different, downright vicious M3. In first gear, mashing the gas at 5, 10, or even 25 mph produces nearly endless rear wheelspin. A quick shift to second summons further fishtailing-all without any clutchwork antics!

Clearly, the DSC was designed to keep average schmoes from powering themselves right off a twisty mountain road, but we feel it chokes the M3 way too much for aggressive driving. BMW does allow the system to be turned on and off, depending upon the driver's mood and ability, and the road conditions. Click off the DSC, and any hint of understeer can be counteracted with your right foot, allowing the capable pilot to balance the car as he wishes. Beautifully executed, tail-out slides are downright easy.

Enthusiast drivers have criticized the current 3 Series' steering as being overboosted and devoid of feel. Not so the M3's; the system's boost characteristics have been adjusted for M duty, more accurately telegraphing what the front suspension has to say. Don't let this talk of power oversteer make you think the tires aren't doing their thing, because grip levels are tenacious. And while the M3's handling can be considered nothing less than outstanding, and although the whole car is ultra-communicative, we were pleased that a reasonably supple ride quality has been maintained-not always the case with stiffly sprung cars running tall wheels and low-profile rubber.

Without a doubt, the new M3 delivers more motion and emotion (or is that M-motion?) than ever before. But with only 3000 cars coming to the U.S., the M3 will be a hot commodity-no doubt translating to abusive dealer markups. But if you're in search of the best sport coupe in the world, there's nothing more M-pressive than the all-new '01 M3. Even at its $45,000 price, this is a bargain.

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